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Studiengesellschaft Kohle v. Shell Oil Co.
United States Court of Appeals for the Federal Circuit
112 F.3d 1561 (1997)
Studiengesellschaft Kohle, MBH (Kohle) (plaintiff) was the licensing arm of a German research and educational organization and the owner of several patents on processes used to make high-molecular plastics, including polypropylene. Kohle licensed Shell Oil Company (Shell) (defendant) to use certain patents beginning in 1974. After multiple disputes over one of the patents (‘698 patent), Shell and Kohle renegotiated the license in 1987. The new terms provided Shell with a paid-up license to produce 450 million pounds of polypropylene per year, with a 1.5 percent running royalty on annual polypropylene sales exceeding 450 million pounds. Also in 1987, Shell began to produce polypropylene by an alleged new process in Seadrift, Texas (Seadrift process). Shell contended that the ‘698 patent did not cover the Seadrift process. Therefore, Shell did not pay royalties to Kohle, in violation of the license agreement, on polypropylene produced by the Seadrift process. Kohle terminated the license in 1993 and brought an action for unpaid royalties from 1987 through 1993 and infringement of the ‘698 patent from 1993 through 1995. Shell moved for summary judgment, challenging the validity of the ‘698 patent. The district court entered summary judgment in favor of Shell, and Kohle appealed.
Rule of Law
Holding and Reasoning (Rader, J.)
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